The Dangers of Wire Fraud: Help Protect Your Clients

BY WILLIAM THOMPSON NJ REALTORS® DIRECTOR OF TECHNOLOGY

Buying or selling a home is one of the largest transactions most people will ever complete in their lifetime and nothing could be worse than finding out you’ve fallen victim to a wire fraud scam during that process.

How could it happen?

A criminal will identify your client as being in the home buying or selling process, they’ll send your clients an email to inform them of “updated wire instructions.” Your clients, to ensure the closing remains on schedule, will quickly do as instructed and in a matter of minutes their entire life savings are gone. According to the IC3 2020 Internet Crime Report, real estate related cybercrimes continue to be on the rise resulting in over $200 million in losses in 2020 alone.

What can you do to help protect your clients from this tragedy?

First and foremost, education is key. First time homebuyers are especially susceptible as they’re unaware of what is considered “normal.” Inform your clients exactly how, when, and who they’ll be receiving instructions from and provide a trusted method of confirming those instructions in person or by phone. Next, I would strongly recommend including the Wire Fraud Notice, part of the NJ Realtors® Library of Forms with every Contract of Sale, which not only offers helpful tips to your clients, but helps mitigate your own risk by having a signed acknowledgement of the dangers of Wire Fraud. To take it a step further, I suggest including a wire fraud notice in your email signature, such as the following provided by the National Association of Realtors®, “IMPORTANT NOTICE: Never trust wiring

instructions sent via email. Cyber criminals are hacking email accounts and sending emails with fake wiring instructions. These emails are convincing and sophisticated. Always independently confirm wiring instructions in person or via a telephone call to a trusted and verified phone number. Never wire money without double-checking that the wiring instructions are correct.”

Finally, keep yourself protected! You, as a trusted client contact, are a target for cybercriminals as they can use your influence in transactions to scam your clients. Be vigilant with every communication you receive; be sure it’s coming from a known email or phone number. Never click on links or open email attachments that you’re not expecting to receive, they may contain malicious software that install on your device without you even being aware. Keep your accounts secure by using strong, unique passwords for every website and never share your credentials with anyone.

What do you do if someone you know is the victim of wire fraud?

First, contact their bank to recall the wire transfer as soon as possible. Next, file a complaint with the FBI’s Internet Cyber Crime Complaint Center, ic3.gov, act quick, the earlier an investigation begins the better the chance for recovery. Finally, contact your local FBI field office, fbi.gov/contact-us/field-offices, for next steps, the FBI is the investigatory agency responsible for cybercrimes.

While no one is impervious there are simple steps you can take to help inform and protect your clients from the devastating effects of wire fraud scams.